﻿<p>
  In previous chapters, we learnt that the Capital Asset Pricing Model (CAPM) treats the market return as the only factor affecting the return of any asset. This chapter will generalize CAPM to multi-factor models of the following form:
</p>
\[ R = \alpha + \beta_1 f_1 + \beta_2 f_2 + \dots + \beta_n f_n \]
<p>
  where each \(f_i\) is a factor.
</p>
